That graph is pretty disturbing (though not surprising). Thanks, David.

I do wonder if speaking of unearned income, as opposed to investment income, would be a better term to use in this country of ours that has such a powerful work ethic. I would think that the average Josephine would be more favorable to the idea that unearned income should be taxed higher than earned income, if not the same rate.

As for Clinton, the senior statesman, …. urgle urgle urgle.

By the nineteen seventies, the ruling class determined that they need not pay rising wages any longer … by two thousand they determined that they no longer had any need for “the people” … at all.

Yet the productive capacity of “the people” has continued, at a terrible price, more hours and more stress, for over one hundred years, in this nation.

Which nation, btw, is much more hated and despised by the rest of the world … since 2001.

Correlations?

Consequence?

Calamity?

Welcome to the Age of the Divine Right of Money.

The neocons and the neoliberals have united to bring about a neo-feudal world … a few more wars, another “bailout” … and then …?

In the face of such tyranny, what are human beings to do?

You suggest that capital be taxed, DDay.

That is commendable and appropriate … now, how do you imagine that, given the current political mindset, given the lack of a comprehensive and useful “method” of analysis of capitalism and its ongoing assault upon liberty, equality, and brotherhood, how do you propose to, first, educate the many in terms that they may understand and embrace, and second, how may the death-grip of the legacy parties on the body politic be successfully challenged and overcome?

Your end goal is laudable, yet you offer no credible means or method to achieve it.

Nonetheless, I hope that you may realize that your reporting is most appreciated and your abidingly human perspectives are most welcome.

As always, I thank you for sharing your understanding and insight, your consistent example of exceptional journalism, practiced as it should be …

DW

There IS such a thing as too much money. People who claim that low taxes on wealth (e.g. capital gains) leads to economic activity have been proven wrong by the past few years. When very wealthy people have more money they do not invest it in businesses that will create jobs, they buy gold, oil, and other commodities.

Obviously, comrade Bartoo, capitalists decided to double down on their fraud. Yet many A-merkins take it in stride, wait for the pendulum to swing, ca-chunk ca-chunk.

It makes sense that the capitalist hegemonster would precipitate the capital apocalypse. Give up your compradorship, you marks. They have led you into the quicksands with brilliant pageantry and piping. Now their brilliant leadership dissipates and they leave you to bury yourselves. Their chaotic competition for supremacy is, and was, ecocidal.

Capitalism is fraud.

Comrade Bartoo, you ask “how do you propose to [...] educate the many in terms that they may understand and embrace”? I would elucidate the betrayals, comrade.

Yet the “leaders” of “organized” labor continue to play their members for suckers. It’s really surprising that more presidents of the fraudulent labor unions are not assassinated.

I would suggest, Ludwig, that a shared perspective which successfully educates, requires more than an iteration of the many betrayals, oppressions, and ongoing exploitation, it requires, specifically, a more perceptive and understandable means of class analysis … one which I consider that you might well be somewhat familiar with?

;~DW

Guillotines for the aristocrats of labor?

Thanks Dave. My take from the chart is that Jimmy Carter had it right and Reagonomics began the decline. At least that is what the timeline suggests to me.

Yes, an elucidation of betrayals in terms class-analytical. But I think the capitalist betrayal is best demonstrated through its frauds. It’s time for the scrupulous detectives; the theoreticians can rest.

This perfectly correlates to the real estate investment income bubble. It is where working for a living was replaced by No Money Down.

They’ve sold out the labor movement so they too can live in gated communities.

Your job is so much easier when it just involves golf trips and accepting wining and dining with those you are supposed to have an adversarial relationship with. /s

When such “demonstration” as you suggest has been pro-offered, then the understanding of what next is needful must arise from a deeper understanding of the nature of relationships between and among people at the two “places” where most of us spend the majority of our time, the workplace and at home. For the long history of acceptance of exploitation, oppression, and betrayal can ONLY be understood in the context of how we treat the value and “product” of work, both in the workplace and at home. While “capitalism” has dominated in most places of work, an essentially feudal “system” has defined the “traditional” family, as women, as soon as they come to understand what that means, will readily and unhappily attest.

If we are not to replace one set of oppressions, betrayals, and exploitation with another, then we must understand much more deeply the nature of our own bifurcated awareness, for our society remains unable to see it and to grasp the psychological and social implications inherent in that essentially destructive “split” … that two-faced behavior which is not consciously available to our understanding unless and until we have prepared ourselves and each other to see it, acknowledge it, and do away with it. Consider that our inability to grasp this deeper reality is a form of self-betrayal, self-oppression, and self-exploitation.

While much of the “problem” is, indeed, “outside” ourselves, is the the result of the “nature” of capitalism as an economic “form”, the critical part which blinds us to fully understanding what we must do to change, successfully, those outward things … lies hidden and, far too often, unexamined within each of our selves.

DW

Something happened around 2000 that separated capital income from the historical norm.

NAFTA – Bill Clinton’s gift to the working class – happened.

Sure, Reaganomics had an effect, but the destruction of the manufacturing base of this country, which didn’t happen the day NAFTA was signed, ended any leverage once held by the working class.

There is no way pay and benefits will improve when the only tool labor has ever had, the strike, is completely removed from the equation by the threat of offshoring.

A Working for America (AFL-CIO) report on offshoring and the decline of manufacturing industries.

Gini ratios since 1967, for family incomes.

The Gini ratio estimates inequality, in this case in family income. A Gini of 0 indicates absolute equality in the sense that the percent of the population (families) and the percent of income they have is the same, for any percent: 1 percent of families share 1 percent of income, 76 percent of families share 76 percent of the income, and so on. In a nation comprising 125million families with a national income of $15trillion, each family’s income would be $120,000 if I still can do arithmetic.

On the other hand, a Gini of the maximum value of 1 occurs when some one family, say the Waltons, just to pull a name out the air, if they still lived as a single household, gets the whole $15trillion. Note that the steady upward trend is seldom interrupted even by recession.

One more graph that is similar to the Cleveland Fed one that David has displayed (with the recessions reduced to those little black bricks across the top), but with a couple more pieces of information included. Note that it’s not fully edited yet.

The stream of dots across the top are the same share of wages+salaries in national income (NIPA) that the Cle Fed has, from 1972 to the beginning of this year. In the beginning of the period, what is approximately labor hauled almost 60% of national income; after generally steady decline, labor share is flirting with and occasionally crossing the sub-50% line.

The lower stream of dots, running through the teeth across the bottom, give the equivalent flow for one of NIPA’s corporate profit measures. So one of the main points of the graph is to display the opposing fates of labor and, very roughly, capitalist shares of income in the recent period. Although profits are more volatile than labor in this graph, their trend is generally up, especially in that post-2000 period David speaks of. One might even say dramatically up.

Part of the story might be in those breakers, or fence staves, or whatever at the bottom of the graph. Those show the share of the civilian workforce who were recorded as union members for each year. After hovering around the 25% mark throughout the 1970s (somewhere I have it that this is near the historic high for the U.S., but need to find it), something or other happens starting in 1981, it appears, following which that proportion headed steadily down unto the present day into the low teens. So loss of bargaining power through the weakening of unions looks like a possible factor, just as the person who figured out how to get those little sticks in there in the first place thought.

But there almost has to be more, even just looking at this graph, because for one thing, the jump up in profit share during the GWBush administration (those colored lines mark the first inaugurations of the Bush and Obama administrations) seems a lot more intense than the jump down in wage share. So since these are shares out of a whole pie, profits must be taking something from somewhere else besides labor, assuming the whole thing isn’t just a measurement error (never assume that! Miss Litella is not the only one who has ever had to say, “Never mind.”).

The biggest thing that’s left after labor and capital(ists), so far as who gets paid for supplying something to the production process, is land, including mines, farms, fisheries, and such as well as plant buildings. It just might be the case that offshoring generates some losses there that are picked up in part by capital(ists), the way these things are accounted. I don’t know, being a conspicuously bad accountant, but it might be worth a look. Similarly, building and maintaining specialized manufacturing plants probably throws off more income than do buildings of similar age that one can just stuff with financial engineers and an air conditioning system; more for capitalists beyond what they extract from labor.

I have no idea whether this is true, but just looking at a graph can give one interesting ideas to pursue.

Interesting. From ’72 to ’10 the Gini increases ~.075. and the share of ‘wages and salaries’ drops by ~.08. These differentials would be equal if all ‘only waged and salaried’ income uniformly lost some percentage of national income and income containing profit uniformly acquired that loss (and ‘only waged and salaried’ income was always less than that containing profit).

If de-unionized workers lost alone 50% of their income this would total less than the ‘wages and salaries’ drops. In other words, the deunionization may just be representative of the decline of all waged and salaried income.

that two-faced behavior which is not consciously available to our understanding unless and until we have prepared ourselves and each other to see it, acknowledge it, and do away with it.

Sorry I took so long to respond, comrade DW, but I could not grasp what two-faced behavior you were referring to. If you refer to a capitalist/feudalist split in ourselves, I would not think that eliminating our capitalist makeup would eliminate fraud. Both capitalist and feudalist depend on hierarchy and fraud.

What depresses a broader awareness of fraud we are engaged in? When Gawd was behind every decree, questioning looked futile. Now, you suffer social Darwinist selection if you confront it. I think you would agree that the awareness of fraud is not so much unconscious as repressed.

Yes the awareness of fraud is repressed, Ludwig, just as the awareness of betrayal and exploitation is culturally AND socially repressed. For decades it has even been dangerous to speak to these things, for to do so invites charges of being “against” the “principles” of the United States of America, of being an “enemy” of the people of United States of America.

However, it is the unconscious “occupation” of the “place” of being oppressed and, at the same time, being an oppressor, however unaware any or all of us may be of that second truth, and it is the truth, that prevents a deeper, more honest, analysis of our common, global, human plight … and what is required, not just of the larger economic “system” (which EVERY society must have, for an “economic system” is, always has been and always will be, the “means” by which those “resources” necessary to human existence are made useful AND available to the members of society) but of each and every member of that society intellectually able to understand what “economic systems” do, or are supposed to do, and that intellectual grasp is certainly available to the vast, vast majority of human beings just as soon as they are apprised of the fundamental “purpose” OF economic systems.

Clearly, that “availability”, that SHARING of those “resources” is not just, NOR sustainable, under the economic system known as “capitalism”, and yet the vast majority of those human beings living and dying “under” that system are unable, and deliberately sought to be kept unable, from imagining anything DIFFERENT that might “work” better for that vast majority AND the environment which sustains their very existence.

Just as religion, as we both agree, suppresses notions and ideas inimical to the power of those who would “control” and direct a given religion, so too, does capitalism, and other forms of exploitative economic “organization”, be they “slavery” or “feudalism”, suppression understandings and discussions which would threaten those who control and profit from those systems.

When the suppression is “internalized”, those who have the power have less to worry about, even if they must seek to justify what they do, protest will be limited and, just as we see in the political “game” of today, in America, the true “believers”, even if they do not benefit from the ministrations of EITHER legacy party, will rise up in umbrage against any who dare to suggest that alternative possibilities deserve to be examined, considered, and even embraced.

DW

I think some numbers would be helpful here. YOu underplay the role of outsourcing, the suppression of unions, and the rise of China.

These elements came together in a perfect storm starting in 2000. Manufacturing employment fell off a cliff after China joined the WTO (2001) and I think that is more directly associated with this trend than anything else.

The only online graphic I know of this is here:
http://www.huffingtonpost.com/dave-johnson/china-springs-the-trap_b_681855.html

Scroll down and look at the graph of manufacturing employment.

The liberty of the oppressed oppressor is no liberty at all.